What is the difference between computing interest at a nominal annual rate of interest and computing interest at the same nominal annual rate of interest compounded monthly

Q: al rate of interest on a bank account is 2.5% and the general rate of inflation is 4%. b) Using the…

A: Given information :

Q: Estimate the annual percent rate for the add on loan Using the given number of payments and annual…

A: As per the information provided:  N = 48 R = 8% To determine: We have to estimate the annual…

Q: What is the effective annual rate (EAR) if your credit card charges you 10.45 percent compounded…

A: The effective annual rate measures the rate of interest or return when the compounding is done on a…

Q: An investment pays you 9% interest, compounded quarterly. What is the periodic rate of interest?…

A: Using excel effective rate of interest function

Q: If the annual interest rate is 7%, what is the monthly interest rate that would be used as the "r"…

A: Time value of money (TVM) refers to the method used to measure the amount of money at different…

Q: What interest rate, compounded monthly, is equivalent to a 10.04% effective interest rate?

A: Effective interest rate : In simple words, the actual rate of return that an individual receives…

Q: What is the monthly interest rate if an annual rate is 13.4%? The monthly interest rate is %. (Type…

A: Given: Annual rate = 13.4%

Q: What nominal interest rate compounded semi-annually is equivalent to j52 14%?

A: Nominal Interest rate Nominal interest rate refers to the simple annual interest rate without…

Q: Given the following credit term, 2/7, n/21, what is the effective annual equivalent percentage?

A: Effective Annual percentage = [ 1 + Timely rate ]Number of times in year - 1

Q: when compounding takes place once annually, is the effective interest equal to nominal interest?

A: Answer: Comparison of nominal interest rates is possible when the compounding periods are same, for…

Q: f the interest is compounded monthly then m is equal to?

A: Compound Interest Compound Interest refers to the interest generated on principal as well as on the…

Q: What interest rate compounded monthly is equivalent to a 10% effective rate?

A: Given,  Effective rate=10% Compounding frequency=12

Q: A certain nominal annual interest rate has an effective rate of 19.722% when compounded…

A: In order to convert, periodically compounded rate to a continuously compounded rate we use LN…

Q: investment, what nominal rate of interest, compounded semi-annually must you earn?

A: Information Provided: Principal = $26,000 Years = 13 Semiannual payments to be received = $1700

Q: a. What is the interest rate per month that is equivalent to 4.26% p.a.?

A: Interest rate is the the rate of interest of due period as a sum of the money borrowed.

Q: what simple interest rate is equivalent to 1% compounded quarterly

A: Simple interest rate is the rate which does not compound means under this rate there is no concept…

Q: The effective interest rate per compounding period is equal to the nominal interest rate per year…

A: The given statement is the effective interest rate per compounding period is equal to the normal…

Q: a. The financial institution's monthly loan interest rate, b. The annual real profit rate of the…

A: Since there are many subparts, as per our guidelines, we will answer the first three. Please repost…

Q: 1. Using the example of a savings account, explain the difference between the effective annual rate…

A: Saving account is the type of deposit account in which interest is paid on the amount deposited.…

Q: Determine the effective rate of interest of the following nominal rates. a. nominal rates…

A: Effective interest rate formula  When Compounded annually and quarterly (1+r/n) n - 1  r= nominal…

Q: An interest pays 1% interest rate, calculate the nominal rate of interest compounded weekly?

A: Interest rate can be defined as the percentage rate at which the interest over the investment or…

Q: What is the effective rate of 16% interest compounded semiannually?

A: In this question we require to compute the effective rate of 16% interest compounded semi-annually

Q: If the total interest paid equals the borrowed principal over 25 years, determine the simple…

A: The formula used as follows: Simple interest=P×r×t

Q: The annual interest rate is 12%. Find (a) the semi-annual rate, (b) the quarterly rate, (c) the…

A: semi-annual rate is the rate that is compounded twice a year (i,e) for every six months is called…

Q: compounded weekly. Determine the sıze of payments, and the total interest paid.

A: Amount borrowed by Jessica = $ 3300 She repays every week up to 2 years  Interest Rate = 3%…

Q: Monthly interest rate?

A: Monthly interest rate is the interest charged on the unpaid balance of credit card.

Q: How much (in dollars) was borrowed at each simple interest rate,

A: A simple interest is the interest that is charged only on the principal amount. Unlike compound…

Q: Consider an account with an APR of 6.2 %  Determine the APY percentage for quarterly  monthly…

A: Annual percentage yield (APY) refers to the rate of interest charged on an investment or loan…

Q: compounded quarterly, what was the loan principal?

A: Information Provided: Years = 20 Monthly payment = $1700 Interest rate = 5.70% compounded quarterly…

Q: For compounding more frequently than annual, the effective interest rate Select one: a. is higher…

A: Effective annual rate is calculated for a nominal rate which is compounded more than once in a year,…

Q: ompute the quarterly interest rate concerning an effective annual rate of 14% and a nominal annual…

A: The nominal interest is interest rate without considering the impact of compounding and effective…

Q: In terms of an effective annual interest rate, how can the interest payment be rewritten?

A: An APR (Annual Percentage Rate) is the nominal rate or the stated rate of interest in any financial…

Q: An account pays 2.9% compounded continuously. What is the effective quarterly rate?

A: The continuously compounded rate, r = 2.9%So the impact of continuous compounding on an amount, A…

Q: How would I calculate the nominal interest rate that is used in the effective annual rate equation…

A: Total number of periods = 12 Loan payment is 15000 Monthly payment is 1387.5 To Find: Nominal…

Q: For compounding more frequently than annual, the effective interest rate Select one: a. equal to the…

A: Effective annual rate is calculated for a nominal rate which is compounded more than once in a year,…

Q: What is the Effective Annual Rate (EAR) on a deposit account with a stated Annual Percentage Rate…

A: The EAR is the actual rate of return earned on the investment whereas APR is simply a stated rate of…

Q: Suppose a credit card has an APR of 30.07% and changes its compounding period from monthly to daily.…

A: Effective interest rate is interest after considering the effect of compounding.

Q: he discount factor corresponding to a 3-year continuously compounded interest rate is 0.765667. What…

A: The effective rate is the after considering the impact of compounding and always more than actual…

Q: What interest comp. monthly is equivalent to an interest rate of 16.3% comp. quarterly?

A: First, we need to convert Quaterly compounded rate to Effective Annual Rate So, 16.3% Compounded…

Q: What is the effective rate of interest if a bank specified a nominal rate of 20% compounded…

A: In effective rate of interest the compounding are taken into consideration.

Q: What is the effective interest rate per payment period for an interest rate of 12% compounded…

A: The effective rate per period is the rate per period when the nominal rate is compounded at a…

Q: To compute for the annual interest payments of a loan, the principal amount is multiplied by: a.…

A: Nominal Rate of a loan is the rate by which interest is paid on the loan. Market Rate and Effective…

Q: What is the true rate of the cost of credit on a YEARLY basis? interest rate (your response)…

A: Cost of credit is the additional amount over the amount borrowed. It should be repaid by the…

Q: What nominal interest rate compounded quarterly is equivalent to j∞=j∞= 7%?

A: Nominal Interest Rate: This percentage increase in the amount of money you pay the lender in…

Q: Considering the amortisation schedule, what is the percentage, rounded to two decimal places, of the…

A: First we need to know the net home payable amount   Edwill Purchased a new home  Cost is R110790000…

Mortgages

A mortgage is a formal agreement in which a bank or other financial institution lends cash at interest in return for assuming the title to the debtor's property, on the condition that the obligation is paid in full.

Mortgage

The term "mortgage" is a type of loan that a borrower takes to maintain his house or any form of assets and he agrees to return the amount in a particular period of time to the lender usually in a series of regular equally monthly, quarterly, or half-yearly payments.